For the Quarter Ending June 2024
North America
The North American Sorbitan Monostearate market in Q2 2024 saw significant price fluctuations due to shifting supply and demand dynamics. April witnessed a notable price decline in the United States and Chinese provinces, primarily driven by easing geopolitical tensions that reduced freight and shipment costs. Oversupply from previous bulk purchases, decreased buying activity, and weakened consumer confidence due to inflation contributed to a softer market. The strengthening U.S. dollar further pressured prices downward.
Global supply chain disruptions, ongoing geopolitical tensions, and logistical challenges, including drought-related bottlenecks and vessel delays, continued to impact the market. The implementation of a General Rate Increase (GRI) by shipping carriers increased procurement costs, leading industry participants to adopt bulk buying strategies to mitigate future supply uncertainties and leverage arbitrage opportunities.
In the U.S., the most significant price shifts were linked to the early onset of the peak shipping season, strong local purchasing, and robust downstream demand. Seasonal factors, particularly the anticipated increase in summer demand, played a key role in driving price increases. These various elements collectively shaped the dynamic pricing environment of the Sorbitan Monostearate market in North America during this period.
Asia Pacific
In Q2 2024, the pricing environment for Sorbitan Monostearate in the APAC region saw a significant upward trajectory due to several key factors. Heightened global energy costs, increased raw material prices, and constrained supply amidst surging demand from various industrial sectors were primary drivers. The escalation in freight costs, partly driven by soaring crude oil prices, further compounded the upward pressure on prices. Despite no notable plant shutdowns in the region, supply chain disruptions exacerbated the situation, creating a substantial supply-demand imbalance.
India experienced the most pronounced price fluctuations during the quarter, marked by robust demand and limited product availability. Elevated input costs and a persistent increase in energy prices, further exacerbated by extreme heatwaves, impacted production capacities. The depreciation of the Indian Rupee against the US Dollar added to import costs, sustaining the upward price momentum. Strong demand from downstream industries continued throughout the quarter, maintaining a stable yet bullish market sentiment.
Comparing the first and second halves of the quarter, the price of Sorbitan Monostearate observed a notable average quarterly increase, reflecting consistent upward pressure. The quarter-ending price settled at USD 2307.94/MT Ex-Nagpur, with an average quarterly incline of 4.20%, underscoring the positive pricing environment. The overall market sentiment in Q2 2024 was decidedly positive, driven by robust demand, constrained supply, and escalating production costs, translating into higher prices and a bullish outlook for the industry.
Europe
The European Sorbitan Monostearate market experienced significant volatility in Q2 2024. Initially, prices surged due to increased production costs and supply chain disruptions. However, Germany saw an unexpected price drop in April, driven by oversupply from previous bulk purchases and weakened market sentiment. Reduced buying activity and lower consumer confidence, exacerbated by inflation, further dampened demand.
Global factors greatly influenced market dynamics. Easing geopolitical tensions reduced freight charges, affecting overall pricing. The strengthening US Dollar against the Euro posed challenges for regional producers and suppliers. Rising feedstock prices significantly increased production costs, while logistical issues, including the Panama Canal drought and reduced vessel traffic, created supply bottlenecks.
In Germany, a weaker Euro and intensified inflation drove prices higher. The ongoing Israel-Gaza conflict caused sporadic shipping delays, particularly affecting Red Sea and Cape of Good Hope routes, adding to market instability. This complex interplay of geopolitical events, currency fluctuations, and logistical challenges highlights the intricate factors impacting the Sorbitan Monostearate market during this period.
For the Quarter Ending March 2024
North America:
In the tumultuous landscape of the first quarter of 2024, the market for Sorbitan monostearate saw a rollercoaster of fluctuations, with prices taking a notable dip after an initial climb. The journey began with a promising ascent, as the demand for this key ingredient surged. Manufacturers, seizing the opportunity, eagerly expanded their production capacities, optimistic about the continued growth of the market.
However, this surge came with its own set of challenges. The expansion led to increased production costs, which, combined with the rising demand, pushed product prices higher. Amidst this, a glimmer of hope shone through as freight charges reduced, offering a brief respite in what was becoming a complex and consolidated market landscape.
As the quarter progressed into February, a dramatic shift took place. Prices, which had been riding high, suddenly plummeted. This abrupt downturn was fueled by domestic manufacturers and local suppliers stockpiling excessively, leading to an oversupply situation. Compounding this issue was the weakened demand from downstream industries and a lackluster outlook for imports, both domestically and internationally. The ripple effect was felt globally, as exporting regions responded to the oversupply by slashing prices, subsequently influencing the pricing trends in North America. The situation of decreased demand and surplus emphasized the crucial importance of competitiveness, particularly in a region such as North America, known for its high import volumes.
Asia Pacific:
During the first quarter of 2024, the pricing dynamics of Sorbitan Monostearate in the Asia-Pacific (APAC) region were shaped by a range of factors beyond the usual top three influencers. Apart from the typical forces of supply and demand, currency fluctuations, inventory levels, and the consequences of plant shutdowns also played significant roles in driving decreasing pricing trends. Recognizing these shifts, downstream industries strategically accumulated substantial stockpiles in the months leading up to February to hedge against potential shortages and leverage market conditions. However, the actual demand for Sorbitan Monostearate in February fell below anticipated levels, leading to a ripple effect on prices.
The resultant oversupply and reduced demand created a weakened and consolidated market sentiment. Producers and suppliers responded by implementing price reductions to stimulate demand, encouraging downstream industries to make purchases and deplete their existing inventories. Furthermore, a slight appreciation of the nation's currency against the USD offered some stability to the market, albeit to a limited extent. Notably, there were no reported plant shutdowns during this period.
Comparing year-over-year data, Sorbitan Monostearate prices in Q1 2024 were lower than those of the same quarter in the previous year, indicative of an overall downward trend. Prices also decreased compared to the preceding quarter of 2024, signaling a continuation of this downward trajectory. In summary, by the end of Q1 2024, the final price for Sorbitan Monostearate (SPAN-60) Ex-Nagpur in India stood at USD 2041 per metric ton, reflecting an average quarterly decline of 1.91%.
Europe:
In the volatile market of this period, Sorbitan monostearate took centre stage, its prices swaying with the flow of demand and supply. What started as a hopeful rise in prices, driven by strong demand for this product, quickly turned into a decline as the quarter progressed.
The initial surge in prices was a testament to the fervent demand for Sorbitan monostearate, a demand so fervent that manufacturers found themselves expanding production capacities to keep pace. However, this very success story became a double-edged sword as the combination of heightened demand and increased production costs sent prices soaring.
February, however, brought a stark reversal. The market found itself grappling with the consequences of excessive stockpiling by domestic manufacturers and local suppliers. As downstream industries exhibited weak demand and import prospects dwindled, exporting nations were left with bloated inventories. In response, market players adjusted prices downwards in the exporting region, a ripple effect felt keenly in the European market as well, as competitiveness became paramount. March ushered in a different set of dynamics. Decreased freight charges provided some respite, fostering a subdued and consolidated market environment. Despite the cost advantages and improved supply chain dynamics, procurement volumes from downstream industries failed to witness significant upticks, casting shadows of concern across the market.
For the Quarter Ending December 2023
North America
In the final quarter of 2023, the North American Sorbitan Monostearate market experienced price fluctuations due to a notable decrease in overall demand. This decline resulted in reduced market prices across downstream industries throughout Q4 2023. The market for the raw material Sorbitol and upstream corn also saw a significant decline without substantial cost support, impacting the Sorbitan Monostearate market accordingly.
Downstream trading entities exercised caution, and manufacturers adjusted purchase prices gradually after completing acquisition tasks. North America, being a major importer, aligned its trajectory with exporting nations to maintain competitiveness. Despite a robust domestic harvest increasing Sorbitan Monostearate stocks, the market faced oversupply, continuing to push prices down.
The decrease in American corn exports was tied to reduced purchases, further contributing to the decline in Sorbitan Monostearate prices. Weakened import prospects and declining international market demand added pressure on existing inventories, leading to overall fragility and consolidation of the domestic market. The negative market outlook was compounded by the year-end destocking phenomenon, where buyers globally actively destocked their inventories at lower costs, exerting downward pressure on prices before year-end inventory adjustments.
Asia Pacific
In the fourth quarter of 2023 (October to December) within the APAC region, the Sorbitan Monostearate market witnessed several influencing factors impacting prices. Notably, the market experienced limited advancement, characterized by minimal growth. This stagnation can be attributed to weakened demand in downstream industries and diminished export prospects, resulting in increased pressure on existing inventories. Furthermore, a surplus of stockpiling by domestic manufacturers and local suppliers contributed to a reduction in prices. Compounding the negative market outlook was the year-end destocking phenomenon. Prior to year-end inventory adjustments, buyers globally were actively destocking their inventories at lower costs, exerting downward pressure on prices. However, as actual demand fell short, the excess inventory required clearing, consequently leading to a price reduction in the Indian market during this period. The market volume of raw material Sorbitol remained sufficient, and feedstock corn prices exhibited a gradual increase, establishing a connection between the domestic corn market and both new and old markets. Overall, the market grappled with instability and stagnant demand, prompting a cautious approach from traders and manufacturers due to persistently low demand from end-user industries. Nevertheless, there is a forecast that prices will rebound in the upcoming months as demand improves and market players restock their inventories. Regarding price trends, the current quarter's price of Sorbitan Monostearate (SPAN-60) Ex-Nagpur in India was recorded at USD 2170/MT, reflecting an average quarterly decline of 5.45%.
Europe
In the last quarter of 2023, the European Sorbitan Monostearate market experienced price fluctuations, mainly due to a significant decrease in overall demand for the product during this period. This decline in demand resulted in a subsequent reduction in market prices. The diminished demand for Sorbitan Monostearate persisted across various industries throughout Q4 2023. Additionally, the market for the raw material Sorbitol also saw a notable decline, lacking substantial cost support. As a result, the Sorbitan Monostearate market mirrored this downward trend. Entities involved in trading downstream exercised caution, and manufacturers gradually adjusted purchase prices after completing acquisition tasks. Given Europe's role as a major importer, the region aligned its trajectory with exporting nations to maintain competitiveness in the market. Furthermore, weakened import prospects and declining international market demand added pressure on existing inventories, contributing to an overall fragility and consolidation of the domestic market. Compounding the negative market outlook was the year-end destocking phenomenon. Prior to year-end inventory adjustments, buyers globally were actively reducing their inventories at lower costs, placing downward pressure on prices.
For the Quarter Ending September 2023
North America
Throughout the third quarter of 2023, Sorbitan Monostearate prices in North America showed a consistent pattern of fluctuations. This decline in prices, especially in the United States, was primarily due to increased Sorbitan Monostearate availability resulting from ongoing harvests in major exporting countries in the northern hemisphere. Challenges faced by U.S. corn crops, including hot and dry conditions, particularly in the northern regions where crops were still growing, significantly contributed to this price drop. A severe drought in the western part of the United States in late April forced many farmers to abandon their crops. However, Sorbitan Monostearate prices substantially decreased from their peak in late June during July. This drop can be attributed to the start of the harvesting season, aided by July rains, which played a crucial role in crop development, counteracting the earlier dry conditions and hot summer temperatures. Furthermore, a significant harvest in Brazil added to the factors influencing this price decline. Brazil was on track to surpass the United States as the world's leading corn exporter, resulting in an excess supply of Sorbitan Monostearate from Brazil that reduced demand for U.S. corn exports, further contributing to the price drop. Despite a robust domestic harvest that increased Sorbitan Monostearate stocks, the market experienced an oversupply, which continued to push prices down. Additionally, the decrease in American corn exports was tied to reduced purchases, further contributing to the decline in Sorbitan Monostearate prices during this period.
Asia Pacific
In Q3 2023, Sorbitan Monostearate (SPAN-60) prices in the APAC region experienced consistent fluctuations. Prices for Sorbitan Monostearate in Nagpur went from $2498.43 per metric ton in July to $2572.09 per metric ton in September, resulting in an average quarterly increase of 1.40%. The drop in July was due to pressure from raw material sorbitol and the corn market, leading to minor reductions in factory prices and a subsequent slight decrease in domestic market prices for Sorbitan Monostearate in certain areas. However, stability returned by the end of the month as corn prices leveled off. Toward the end of the quarter, sporadic corn entries in the northeast production area and optimistic expectations for a high yield of new-season corn continued to push down domestic corn market prices. This, in turn, had a negative impact on domestic Sorbitan Monostearate market prices due to ample inventories and sluggish demand. Nevertheless, prices rebounded in the middle of the third quarter, driven by the persistent strength of the domestic corn market, fluctuating but eventually stabilizing raw material costs, and increased demand for starch after the summer season. These factors, supported by cost considerations and rising demand, contributed to the sustained strength of the domestic Sorbitan Monostearate market. By the midpoint of the year, domestic corn market prices saw a slight increase, raw material costs fluctuated but eventually stabilized, and Sorbitan Monostearate market prices achieved stability.
Europe
In the third quarter of 2023, there were significant price fluctuations observed for Sorbitan Monostearate in the European market. The most notable drop in prices occurred in July, which had a detrimental impact on consumption in both the food and industrial sectors. This situation was aggravated by a recent rise in inflation, leading to increased production and transportation expenses for corn, further contributing to the downward pressure on Sorbitan Monostearate prices. Additionally, local traders with substantial corn reserves exacerbated the situation by lowering their price quotations as a strategic move to offset potential losses, thus intensifying the market's downward pressure. The prevailing conditions in the corn market, characterized by low production costs and abundant domestic inventories, played a significant role in influencing the direction of Sorbitan Monostearate prices. The surplus supply of corn had a downward effect on prices in both Germany and Belgium, which are two major corn-exporting nations.
